Insurance execs tout need for performance-based health care system [The News & Observer, Raleigh, N.C.]

June 15--DURHAM -- Executives of five of the state's largest insurers said Thursday health care costs will continue to rise in the coming years if there's not a coordinated effort to revamp the nation's health care system.

"The system is broke," declared Tracy Baker, CEO and president of WellPath. "It's a bad design."

He said the United States must shift from a system where the more health care you provide the more you make to one that pays providers based on their performance and efficiency.

Baker joined executives of Aetna, Cigna, BlueCross BlueShield and United HealthCare on a panel that focused on rising health care costs and what insurers, providers, companies and individuals can do about it. The event, held at the Sheraton Imperial, was sponsored by Hill, Chesson & Woody, a Chapel Hill-based employee benefits consultant.

The panelists touched on a range of issues that they said are contributing to spiraling health care costs.

Charles Pitts, president and general manager of Cigna Healthcare Carolinas, said too many Americans live unhealthy lifestyles that leave them with chronic diseases that are costly to treat. He said the health care system must focus more on prevention, with incentives built into insurance plans to encourage more healthy behavior.

There was also much discussion about the need for more transparency in what things cost, and for companies and their employees to have a better understanding about how their use of the health care system contributes to rising costs.

Baker said too many businesses today continue to use outdated health care plans that don't support the innovative approaches now being used to reduce costs. Margie Maxwell, president of Aetna's Southeast Markets, said it's no longer enough to simply have one meeting a year to discuss the benefit plans offered to employees.

"You need more education," she said.

Garland Scott, CEO of the North and South Carolina markets for United Healthcare, said his company now rates health care providers to distinguish those that can efficiently deliver the best patient outcomes.

Looming over Thursday's discussion is the U.S. Supreme Court's review of the constitutionality of President Barack Obama's health care reform legislation. The court is expected to rule on the case any day.

Whatever the court's decision, the panelists described how in the coming years there will be a major shift of health care costs from the public sector to the private sector as the government lowers reimbursement rates for Medicaid and Medicare.

While health care reform will add many new patients to the rolls of the insured, Baker said it would also raise costs for those considered low risk as they subsidize higher-risk patient pools.

All the panelists said the pace of change in health care needs to accelerate, and that stakeholders need to come together to design a better delivery system that all can live with.

"Today we know it's broken but we don't have a platform to jump to," Pitts said.

Bracken: 919-829-4548

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